Wage Stagnation Is Everyone’s Problem

Low working- and middle-class incomes aren’t likely to rise without new subsidies.

In the past two decades there has been a sharp drop in the share of national income going to working- and middle-class Americans. As the discontent among these workers begins to affect their livelihoods and the entire nation’s politics, policy makers must either hope the market will somehow fix wage stagnation or enact policies to reverse it.

For much of the postwar period, American wage and salary earners received an average of 64% of gross domestic product. Although signs of weakness emerged in the mid-1980s, the labor share...